TaxTMI 
TaxTMI 
2018 (1) TMI 157
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....g that they were not accounted; they found shortage of grey cloth and finished fabrics. On the same day, the Officers also intercepted a vehicle carrying man made fabrics and on enquiry, the driver of the vehicle informed that the vehicle was transporting the goods from factory of GSM and produced invoice No.44, dated 15.05.1997; authorities found on inspection, that additional quantity of processed fabrics was found in the vehicle than as indicated on the invoice No.44. The said vehicle and the additional quantity of processed fabrics was seized. The authorities recorded statements of Shri Gopal Gupta, Managing Director of GSM; Shri Bhavani Kishore, Accountant of GSM; Shri Ashok Kumar Agarwal, one of the Directors of GSM; Shri Subhash Agarwal, Proprietor of S.N Textiles; Shri Nirmal Kumar Agarwal, Proprietor of Kunchal Textiles and Shri Kamal Kumar Agarwal, Proprietor of Hanuman Textiles. 3. On analysis of such statements and evidences, the authorities came to a conclusion that there was an attempt to remove finished goods clandestinely and there was clandestine removal of goods during the period 01.01.1997 to 14.05.1997. A show cause notice was issued for demanding the duty on....
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....o independent witnesses. Stock taking was conducted in a scientific and systematic manner, the production of the man made fabrics was manipulated in the records, facilitating the clandestinely removal of the goods which is evident from the fact that the vehicle which was intercepted contain the quantity more than the invoice as per invoice No.44; that the dealers of GSM have categorically admitted that they received processed fabrics from GSM without any documents. 7. On careful consideration of the submissions made by both sides, I find that Ld. Counsel's main grievance is that the adjudicating authority has not followed the law as settled by Hon'ble High Court of Punjab & Haryana in the writ petitions. He fairly concedes with the judgment of Hon'ble High Court of Punjab & Chandigarh in the case of Ambika International which follows the judgment of the same Court in the case of Jindal Drugs Pvt. Ltd [2016(340) E.L.T. 67 (P&H) was produced before me as this is the recent development of the law. It is also noticed that the entire adjudication proceedings (denovo) is after the judgment by the Hon'ble High Court of Andhra Pradesh, wherein their Lordships had directe....
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....lation to any proceeding under this Act, other than a proceeding before a Court, as they apply in relation to a proceeding before a Court." 9. A plain reading of sub-section (1) of Section 9D of the Act makes it clear that clauses (a) and (b) of the said sub-section set out the 3 of 10 CWP No.12714 of 2016 circumstances in which a statement, made and signed by a person before the Central Excise Officer of a gazetted rank, during the course of inquiry or proceeding under the Act, shall be relevant, for the purpose of proving the truth of the facts contained therein. 10. Section 9D of the Act came in from detailed consideration and examination, by the Delhi High Court, in J.K. Cigarettes Ltd. Vs. CCE, 2009 (242) ELT 189 (Del). Para 12 of the said decision clearly holds that by virtue of sub-section (2) of Section 9D, the provisions of sub-section (1) thereof would extend to adjudication proceedings as well. There can, therefore, be no doubt about the legal position that the procedure prescribed in sub-section (1) of Section 9D is required to be scrupulously followed, as much in adjudication proceedings as in criminal proceedings relating to prosecution. 11. As already not....
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....a) of subsection (1) thereof, would be pregnable to challenge. While the judgment of the Delhi High Court in J&K Cigarettes Ltd. (supra) holds that the said challenge could be ventilated in appeal, the petitioners have also invited attention to an unreported short order of the Supreme Court in UOI and another Vs. GTC India and 5 of 10 CWP No.12714 of 2016 others in SLP (C) No.2183/1994 dated 03/01/1995 wherein it was held that the order passed by the adjudicating authority under Section 9D of the Act could be challenged in writ proceedings as well. Therefore, it is clear that the adjudicating authority cannot invoke Section 9D(1)(a) of the Act without passing a reasoned and speaking order in that regard, which is amenable to challenge by the assessee, if aggrieved thereby. 16. If none of the circumstances contemplated by clause (a) of Section 9D (1) exists, clause (b) of Section 9D (1) comes into operation. The said clause prescribes a specific procedure to be followed before the statement can be admitted in evidence. Under this procedure, two steps are required to be followed by the adjudicating authority, under clause (b) of Section 9D (1), viz. i) the person who made....
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....lause (a) of Section 9D(1). In all other cases, if he wants to rely on the said statement as relevant, for proving the truth of the contents thereof, he has to first admit the statement in evidence in accordance with clause (b) of Section 9D(1). For this, he has to summon the person who had made the statement, examine him as witness before him in the adjudicating proceeding, and 7 of 10 CWP No.12714 of 2016 arrive at an opinion that, having regard to the circumstances of the case, the statement should be admitted in the interests of justice. 20. In fact, Section 138 of the Indian Evidence Act, 1872, clearly sets out the sequence of evidence, in which evidence-in-chief has to precede cross-examination, and cross-examination has to precede re-examination. 21. It is only, therefore, (i) after the person whose statement has already been recorded before a gazetted Central Excise officer is examined as a witness before the adjudicating authority, and (ii) the adjudicating authority arrives at a conclusion, for reasons to be recorded in writing, that the statement deserves to be admitted in evidence, that the question of offering the witness to the assessee, for cr....